What’s a Keynesian monetary quack to do when the economy and markets fail to remain “on message” within a few weeks of grandiose declarations that this time, printing truckloads of money has somehow “worked”, in defiance of centuries of experience, and in blatant violation of sound theory? In the weeks since the largely meaningless December rate hike, numerous armchair central planners, many of whom seem to be pining for even more monetary insanity than the actual planners, have begun to berate the Fed for inadvertently summoning that great bugaboo of modern-day money cranks, the “ghost of 1937”.
Inflation on the things we NEED..........Deflation on the things we don't NEED.........welcome to the machine.
“To the intelligent man or woman, life appears infinitely mysterious, but the stupid have an answer for everything.” ~Edward Abbey
“Do not believe in anything simply because you have heard it. Do not believe in anything simply because it is spoken and rumored by many. Do not believe in anything because it is found written in your religious books. Do not believe in anything merely on the authority of your teachers and elders.” - Buddha
You don’t actually have any savings. When you make a deposit, you’re trading your money for a banker’s promise to repay you. And there are countless regulations giving them the authority to break that promise. (If you want to test this premise, try withdrawing $25,000 just to see how your bank reacts.) That’s the system that controls your wealth today. It’s almost entirely digital. And it’s run by unelected bureaucrats whose interests are not aligned with your own. This is not a free system. And any rational person should consider parking at least a rainy day fund outside of this system.
The production structure has long since adapted to ZIRP and “short-term gambling, punting on momentum-driven moves, on levered buybacks” are further lifting the opportunity costs of abandoning it. In order to try to rescue its credibility, the Fed may decide to try some timid, quarter-point increases. But what will they do if markets really crash?
Almost all serious analysts see a Terminal problem developing - "We will go from deflation to hyperinflation without seeing inflation." But hyperinflation is a political phenomenon. It is caused by those same authorities the masses think they can trust. When they are threatened, they will protect themselves by printing money on a scale we haven’t seen since the War Between the States (consumer prices in Richmond, Virginia, had risen 6,700% by the end of the war).
Somehow everything in the following statement from David Petraeus is wrong: "There is no shortage of customers for the purchase of U.S. Treasuries," said Petraeus.... "Given the relative strength of the U.S. economy and the prospect of the Fed raising interest rates at some point in the months ahead, I suspect there will continue to be very keen interest in U.S. Treasuries."
Rickards said that gold is like “fire insurance on your house” ... “Nobody wants their house to burn down but if it does you are glad you have some insurance”.
As an investor, you have enough to be concerned about just taking into account factors like inflation, deflation, Fed policy and the overall state of the economy. Now you have another major threat looming – financial warfare, enabled by cyberattacks and force multipliers. What can you do to preserve wealth when these cyberfinancial wars break out? The key is to have some portion of your total assets invested in nondigital assets that cannot be hacked, wiped out or disrupted by financial warfare. The time to take defensive action by acquiring some non-digital assets is now.
There is no better way to describe the international monetary system today than through the statement made in 1971 by U.S. Treasury Secretary, John Connally. He said to his counterparts during a Rome G-10 meeting in November 1971, shortly after the Nixon administration ended the dollar’s convertibility into gold and shifted the international monetary system into a global floating exchange rate regime that, "The dollar is our currency, but your problem.” This remains the U.S. policy towards the international community even today. On several occasions both the past and present chairpersons of the Fed, Ben Bernanke and Janet Yellen, have indicated it still is the U.S. policy as it concerns the dollar. Is China saying to the world, but more particularly to the U.S., “The yuan is our currency but your problem”?
Austrian Economics Is Now Equivalent To Terrorism Thanks To Latest Islamic State "Gold Standard" Propaganda ClipSubmitted by Tyler Durden on 08/30/2015 13:16 -0500
What better way to mute demands for a return to sound money and the gold standard, than by making them equivalent to jihadist terrorism? Why, there are none, which may explain the hilarious appearance of the "Islamic State's" latest 55-minutes pro gold standard YouTube clip, which is nothing but a crash course in Austrian economics.
Jim Rickards, “I think it’s always very important to own gold. I’ve recommended that investors have about 10% of their portfolio in the yellow metal.” “If I’m right and some catastrophic event is on the horizon, then that 10% would be your portfolio insurance.”
Tick, tock... "it could never happen here?"